BuzzFeed News is being shuttered, with HuffPost remaining as the only news brand for the media company BuzzFeed, according to multiple news reports. The company went public via a SPAC just 16 months ago.
CEO Jonah Peretti sent a memo to staff Thursday, outlining the shutdown of BuzzFeed News, saying the company can “no longer afford to fund” the news section as a “standalone organization” and cutting the workforce by 15 percent, or 180 staffers, across its business, content, tech and admin teams. Additionally, the company’s chief revenue officer Edgar Hernandez and COO Christian Baesler will both leave the company. BuzzFeed president Marcela Martin will take over all revenue functions effective immediately.
SPAC 890 5th Avenue Partners’ stockholders approved the business combination with BuzzFeed in December 2021. However, without mentioning redemptions, the SPAC said only $16.2 million remained in its trust account. The SPAC raised $287.5 million in an IPO, so redemptions would have to have been in the vicinity of 94%.
890 5th Avenue said in a news release announcing the deal approval that another $150 million in convertible notes would also go toward closing the deal, providing a total of $166.2 million. That’s about 62% less than the $438 million in proceeds BuzzFeed expected when the deal was announced.
The company is also “proposing headcount reductions in some international markets” and has made plans to reduce its real estate footprint in Los Angeles from four buildings to one, after cutting down on its real estate in New York last year, Peretti wrote in the memo. BuzzFeed will also be reducing budgets, open roles, travel and entertainment and cutting many other “discretionary, non-revenue generating expenditures.”
